The Yangon City Development Committee (YCDC) will build a small waste-to-energy plant worth $16.2 million in cooperation with Japan, a top official said.

Construction of the machine, which has the capacity to burn 60 tonnes of trash, will start this month, said U Aung Myint Maw, deputy director of Environment and Cleaning Department, YCDC.

The construction is expected to be finished by March 2017, he added.

The 15-acre garbage burning plant will be located in Shwepyithar township. Japan’s Ministry of Environment will contribute $8.2 million and YCDC will provide $8 million for the factory, which will be built by Japanese firm JFE Engineering

“The plant will burn waste to produce steam that drives turbines. Our garbage management system is very weak and this project will help us in collecting and cleaning garbage systematically,” U Aung Myint Maw told Myanmar Business Today.

“The plant will be able to produce 700KW of electricity – 300KV will be used for the plant while the rest will be sold to Yangon Electricity Supply Board,” he said.

However, he added that YESB still hasn’t agreed on a fixed price to buy the electricity and the department is not sure how much profit it can get from the electricity that the factory will produce.

Yangon creates about 1,600 tonnes of garbage every day – 600 tonnes is destroyed in North Dagon garbage port, 800 tonnes in Hteinpin garbage port and the rest is taken care of at smaller facilities around the city, according to Environment and Cleaning Department, YCDC.

The project is JFE Engineering’s first project for a waste-to-energy facility in Southeast Asia. To bring down development costs, the company commissioned its Indian unit to draw up the design, according to a Nikkei report.

The Yangon plant falls under an agreement through which Japan provides support to help solve Myanmar’s environmental problems in exchange for carbon credits, the report added. Tokyo will receive annual credits for 2,400 tonnes of carbon dioxide over 15 years.